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Re: Weekend Charts

Albertarocks — Sat, 20 Feb 2010 17:23:04 -0000

Yes, that was an excellent observation by Santos. But not to worry Daneric, you give us plenty of great observations yourself. Here's another one: I use Excel to create a ton of handy dandy calculators. One of them calculates what will happen with the MACDs and their histogram in the future. I realize this is outside the realm of EWT (which I subscribe to as well), but my findings still supports the bearish case. These figures are going to shock those who pay a lot of attention the MACD and its histo (as we all should). Here's what it says:

If $SPX closes Monday below 1124, its weekly MACD is still pointing down.
If $SPX closes Monday below 1103, the histo on that weekly MACD goes flat (has ceased rising).
If $SPX closes Monday below 1106. the daily MACD histo will go flat (has ceased rising)
If $SPX closes Monday below 1092, the daily MACD will be rolling over and headed lower.

If you look at those charts right now, you'll probably think it's not possible (especially the histos because they look so bullish). I wouldn't blame you, because I made the program myself and I sometimes still can't believe what it tells me. But it works whether I can believe my eyes or not. No matter what happens Monday, all these figures would have to be recalculated based on Monday's close. Upon that recalc, they could well even improve for the bear case, even if the markets remained flat on Tues. Eventually, when they're all headed lower, there's no point in referring to my calculator. I just use it when I'm edgy. lol Unfortunately, it can't force the market to go the way I want it to go :-)

Now some of those lower levels I mentioned above won't be hit Monday, but the point is that it's not going to take much to turn the MACDs and their histograms quickly lower, on both the daily and weekly charts. The bulls are looking at them and drooling. They have no reason to drool (they just don't know it yet). I don't know if any automated trading systems pick up on MACDs, but if they do, they're not gonna like it either.

I've done $RUT, $NDX, financials and others... the story is the same for all. If the markets trade lower on Monday (I'd say they "have to" considering how overbought they are), and the investment world sees what damage that's done to the MACDs, they're not gonna like it. It all centers around how the MACD is calculated, and the 12 period and 26 period EMAs (and where they are, which way are they heading and generally what they're doing). I've often calculated these things and couldn't believe what my program told me. But sure as hell, the next day, bingo! The future levels for MACDs and their histos had indeed been accurately foretold and they did what my calculator said they would do. lol

Before you poopoo my findings, just be patient and watch what happens Monday. If you're bearish on the markets, you'll be pleasantly surprised by how quickly the MACDs and their histos have moved in your favor (provided the markets turn lower at all).

I hope someone found that useful or at least interesting.

Albertarocks

Re: Weekend Charts

Albertarocks — Sun, 21 Feb 2010 00:32:55 -0000

You're welcome... and thank you right back. That was my first post here and I'm glad you appreciated it.

Re: Weekend Charts

Albertarocks — Sun, 21 Feb 2010 11:46:21 -0000

I'll chime in on this one mawwam. I created a chart of $CPC and overlaid $SPX behind it. I had intended to see if I could link you to that chart, but turns out it doesn't really fit this discussion anyway, because the author Lamoureaux's chart is not of the $CPC itself, but of the "volatility" of the $CPC. Actually, "range" within the $CPC would be a better term. He's noticing that the price range within the put/call ratio has gradually been becoming narrower and narrower since the 2007 top. At this point in time, I'm having a hard time deciding whether this is important or not.

The general consensus though is that the p/c ratio is a contrarian indicator. I've never even really bought into that argument either. That argument is based on the idea that since it's the big boyz who sell the options and the retail investor who buys them, when a lot of puts are sold to the stupid public (I use that word because it pisses me off that the blowhards on Wall Street keep insinuating that the retail investor is stupid), and the stupid public is going to be worng, then when the p/c ratio is high the market is not about to drop. I don't buy into that argument for a couple of reasons: First, I don't think it's the general stupid public who purchases most of the options anyway. I think for the most part it's hedge funds protecting their positions. The biggest sellers of puts AND calls are the criminals, GS and that entire den of demons. Since they know which way they're going to shove the market (to the extent that they have control over it), then yes, a high put/call ratio means they've sold more puts than calls expecting to collect the premiums on both, but puts more so. Therefore, when the ratio is high the market "should" rise (or at least not drop).

You probably knew all that, so I apologize for insulting your intelligence. But I had to lay that out in order to form a base so we could try to discuss this. BTW, I'm just making this up as I go along, so don't pay any attention to me. lol Anyway, Lamoureaux is saying that there's a compression in volatility (or range) within the ratio. I'd simply interpret that to mean that since the 2007 high, even though we've seen a massive crash and an incredible fast rally off that crash, the p/c ratio has continued to become less and less volatile throughout. In my opinion, that probably indicates a combination of two things, less indecision (fear) and more complacency. But an important factor, the fact that the volatility within the ratio is decreasing doesn't indicate whether the ratio itself is increasing or decreasing. It just means that that options market isn't as "wild" as it used to be.

Lamoureax is implying that he expects this "coil" to explode some day. If it's going to explode, it would be upward, meaning a huge spike in "volatility", wildness, fear. It does not imply in which direction the p/c ratio would be headed. When (if) that happens though, my guess would be that the market is headed lower because increased volatility would likely mean increased fear. Or am I wrong about that? I openly admit that my bias is absolutely bearish and I'm trying not to let that influence this discussion. I'm trying to be logical here, but I honestly don't know if it helps us know which way the market would be headed when this coil does explode. Nor do we know "when" it would explode.

I only entered this post because you asked for an opinion and I found the topic to be interesting. But I don't pretend to know what this means for sure and I'm absolutely open to other points of view. So on second thought, don't bother reading this. :-)

Re: Elliott Wave Update ~ 22 February

Albertarocks — Mon, 22 Feb 2010 17:11:42 -0000

Daneric, I don't know if you're interested in this analysis so let me know if you'd rather not see them. In the meantime, I wanna thank you for your work. It really helps give me perspective and options I wouldn't have otherwise seen. I really appreciate them, and obviously other people appreciate your work too.

But like you and probably most of the other guys here, I refer to a lot of indicators and of course the MACD and its histogram are near the top of the list. Sometimes, when we're at a stage like we're at today, I get antsy as hell. So I use one of my calculators to figure out what would happen to the MACD tomorrow at any certain price.

For example, in the $WLSH, as long as price is below 11,587 tomorrow, the MACD histo on the daily chart is going to be lower than it was at the close today. Naturally, if we're bearish we want to see that. For the MACD, in order for it to roll over "tomorrow", price would have to get down to 11,370. Of course, at the end of trading tomorrow, a recalculation would come up with a new level for Wed. Anyway, 11,370 is the exact price where the MACD on the daily chart goes horizontal on its way to rolling over "tomorrow". Sometimes I find these calculations reassuring... to know that it won't take much change in price (going in my preferred direction) to have the effects I need to see in order to feel comfortable with a position (in this case, bearish).

Re: Elliott Wave Update ~ 22 February

Albertarocks — Mon, 22 Feb 2010 23:44:56 -0000

Sure! I gave the numbers today for the $WLSH simply because that was the chart Daneric used today to begin his posts. (I'm assuming his name is Dan?) I won't post these very often, just when we get at a real aggravating turning point that just won't turn. I occasionally do these analyses just for my own peace of mind, so why not share?

For the S&P:

For Feb. 23, as long as $SPX is trading below 1112, its MACD histo on the daily chart will be lower than today's closing histo. At price level 1092, on Feb. 23, the MACD on the daily chart of S&P will have gone horizontal, on the way toward rolling over. In other words, they're damned close to turning bearish. In fact, if you look at a daily chart of $NDX, you can see that the histo has gone level today. It's stopped rising, suggesting upward momentum is pretty much gassed out.

Re: E-minis

Albertarocks — Tue, 23 Feb 2010 17:11:35 -0000

Apparently a couple of you like the MACD and histo calcs I've been posting. As you can see, the forecasts that my calculator pooped out yesterday came true, as can be seen on all the histos I gave values for. As the calculator indicated, all of them are now lower on the daily charts than where they closed yesterday. If this sell-off continues tomorrow (Feb. 24th) though. then my little contributions here will no longer be needed because we will all be able to clearly see where the MACDs and their histos are heading. But one more entry (as per request):

For Feb. 24th: For the S&P (as per request): It's clear the histo is already falling on the daily chart. If I told you what level it would now take to make that histo pop back up to flat or level with its close today, you wouldn't believe me. But it's high, real high. IOW, tomorrow no matter if we get a rally or not, the histo on the daily chart *is* going to be lower than its close today.

The MACD though, isn't quite as clear. The fact is, that on a microscopic level, it's still pointed upward at today's close. If the S&P trades below 1092 on Feb. 24th, the MACD on the daily chart will mathematically have rolled downward. Any price above 1092, and it's not quite yet horizontal. Basically, all the other indices are pretty much in the same situation. MACDs are all trying real hard to turn down... very, very close for all. This is crucially important, because when a MACD turns down, leaving behind a new lower high (in itself) and a new lower high in the index, that's a very bearish situation. For those of us who are bears, this is a critical time. We're almost there :-) Now price action just has to co-operate. A tiny rally won't ruin this, as long as it's small. A little rally to say 1100 will force us to wait for another day.

I hope nobody thinks this info is a waste of time. It isn't, if you believe the MACD and its direction are important. So far Dan hasn't answered my question about if he minds me posting this info here, so I'm going to assume he doesn't mind. It's my way of trying to pay him back for his great work. Anyway, I kind of doubt this little contribution will be necessary in the coming days because I believe the direction of all the MACDs are about to become very clear. It's only at times when the MACDs are trying to roll up or down, when we're expecting a change in market direction that just keeps pushing and pushing and pushing, and won't make that turn, that's when this analysis becomes very valuable. If not downright comforting. The calculator can only work out what will happen with the MACD (and its histo) for the next candlestick bar. So it's very, very valuable on a daily and weekly basis. Sometimes when a monthly chart looks hopelessly bullish, this calculator stuns me with how little it would actually take to turn a monthly bullish looking chart into a decidedly bearish looking chart. I know, I've tried it and it's just waaaay too cool to see the indicators change exactly as foretold.

So for tomorrow, Feb. 24th, it's S&P 1092.

Re: E-minis

Albertarocks — Tue, 23 Feb 2010 22:02:11 -0000

My pleasure. All of us work too hard at this not to make some damned good money. There are a lot of pieces to the puzzle and I'm just trying to make one of the pieces more clear to understand, hopefully to the benefit of anyone who cares to listen.

Re: E-minis

Albertarocks — Wed, 24 Feb 2010 13:30:15 -0000

I like the way you're thinkin' Saboya, but today I just can't help but to be feeling so fuckin' frustrated that I'm ready to throw in the towel after being bearish since 1977. Today, my mind absolutely refuses to see that leg down from the high of Feb. 20th as anything other than an 'abc'. Let me advise you people, the day I throw in the towel and go bullish, will absolutely, 100% guaranteed, be the market top.

For decades, I used to single handedly control the entire Canadian real estate markets. Every time I sold my house was always and I mean "always", the first day of a bull market in real estate that saw prices triple over the next 3-4 years. The day I bought a house invariably marked the top of the markets. I did that 4 god damned times. I got so fuckin' good at it, that the day I sold my house, half my friends went out and bought a second one. I made a lot of friends rich that way.

Well today's the day! Load up with bear plays boys, because I fucking give up. I'm gonna buy a god damned truck load of SPY 150 calls. They should work just fine as long as those motherfackers at Goldman are are still alive. Speaking of which, I'm going into the gallows building business.

(let's see if that works. lol)

Re: E-minis

Albertarocks — Wed, 24 Feb 2010 14:07:06 -0000

Yeah! This is some impressive freakin' rally alright. If volume continues on its current trend on this god damned smoke and mirrors pump-job of a phony leg up, on March 17th the volume on $NDX will officially be zero.

Re: E-minis

Albertarocks — Wed, 24 Feb 2010 16:18:55 -0000

Yeah! The Alberta market is kind of boom or bust. Although the economy here is way more diversified than it used to be, it's still energy dependent to a great degree, where Ontario is more manufacturing based I think. Either way, so much of the products of both provinces is sold into the US, that we're not in for a good time I don't think. It's kind of funny about the Alberta market. People in Edmonton are way more panicky than Calgarians, who are a little more cool about things. So the fluctuations in the Edmonton RE market are off the charts whereas Calgary is much less volatile.

Re: E-minis

Albertarocks — Wed, 24 Feb 2010 16:53:55 -0000

Well I just don't know what to think anymore. I must be the stupidest person on this god damned planet. There's no other reason I can think of why I keep insisting the market's ever going to correct. Apparently the den of demons at GS and their owners at the Fed are simply going to run the fuckin' S&P to 27,000 with all their new found play money.

In the meantime, the world in on the brink of the biggest credit contraction in the history of mankind, which is the mother of all deflationary scenarios. It begs the dollar to surge in value. I know that's hard to accept, but I've written about it many times on other blogs. There are more valid reasons for dollar strength (deflation) than dollar weakness (inflation), by a mile. It's all about how money is created and destroyed. 95% of all money on the planet was "loaned into existence". So as credit contracts (default is the mother of all credit contractions), money disappears back into that imaginary void that it originally was created from. It just disappears off the face of the earth. As long as the Fed refuses to allow it's regional branches to loan any of their seed money into the economy, inflation isn't happening. The selfish whores are using it all for themselves. That's very deflationary because they aren't allowing it to multiply through the magic (perhaps black magic) of the fractional reserve banking system. As John Mauldin says, the US dollar is the worst currency in the world, except for all the others.

Apparently we've come to a point in history where momentum indicators no longer work either. This fuckin' market has been chugging ever higher in the face of glaring negative divergences since June for Kreist sake. It's nothing short of pure unadulterated insanity. Ever since the first week in October, the volume metrics changed so that every surge in the market was on steadily declining volume and every tiny correction was on massive volume. That's the very description of distribution at a top, yet... up, up, up, up, up the bastard goes. No doubt we're in somewhere in the mother of all set-ups, but who the hell knows when they'll pull the plug?. One thing I'm pretty sure of... they'll use some sort of false flag operation or some earth shattering event as an excuse. Until then, those who insist on being bullish do so at their own peril. Sorry for the rant, but I've never, ever seen such an insane situation in stock markets. And I've been doing TA off and on since I stole a book from the library on the topic when I was 11 years old.

ARGGGGGGGGHHHHHH!

P.S: Fuck off Al Gore

Re: Elliott Wave Update ~ 24 February

Albertarocks — Wed, 24 Feb 2010 20:04:59 -0000

There's nobody out there who's more stubbornly bearish than I am. But I'd have to say, based on the financials and RUT, those indices are now about as bullish looking as I've seen them in a long time. These whores are going to run the market to the stratosphere, in spite of the poorest fundamentals in decades. Fundamentals are completely out the window now. They simply don't matter anymore. This is like the tech bubble all over again... the start of the tech bubble.

They say "don't bet against the Fed", and I've been betting against the Fed on every head fake throughout this entire pump-job rally. It's cost me a fortune and to be honest, I really don't see any end in sight. I'm still holding some shorts and I doubt very much I'll even get a decent price to unload them. That's how sick this market has gotten. Honest to God people, I'm the most bearish person on this planet. And I use every indicator out there, combined with EWT, and I work at it 17 hours a day. It just ain't working. It's not gonna work as long as GS has their orders to manipulate the beast and make it look good. The only thing my seriously hard work has gotten me is a hell of a lot more broke. If there's any sort of sell-off in the next week, I'll be looking at it strictly from the bullish perspective for a change. See if I can get an entry point where the indicators give the green light to go long. I'll bet it happens. In fact, I don't even see any bearish scenario anymore. I'm seriously pulling for all of you. Best of luck.

Re: E-minis

Albertarocks — Wed, 24 Feb 2010 20:30:01 -0000

Error

Re: E-minis

Albertarocks — Wed, 24 Feb 2010 20:31:50 -0000

I never thought I'd be saying this, but I'm holding a few bearish ETFs and I seriously doubt I'll even get an opportunity to sell them much lower from here. I think I have to swallow my pride and admit that the god damned Fed and their minions are running the show, not me. So being as careful as I can, using the indicators as best I can, I'm going long at the next opportunity. I've come to the conclusion that we're venturing where no man has gone before. I mean, the bastards have printed something like $14T and they're not sharing it with the economy. So it must be the bankers who are buying this market. From whom? Got me. I think the silly dinks are buying and selling to each other in order to run the values up and improve their balance sheets with phony trumped up equity values. Make sense?

It's like one of you guys take a shit and I'll buy it from you for $1M. Then I'll take a shit and one of you guys buy it from me for $1M. Then I'll sell yours back to you for $2M and I'll buy my own gem back from you for $2M. Hasn't cost either of us a dime in truth, but our balance sheets now say we have $2M worth of shit, so I guess we're richer. Then we can give each other high fives, go partying on a yacht and congratulate each other on how fuckin' smart we are. It works for GS, so it aught to work for us, right?

Re: Elliott Wave Update ~ 24 February

Albertarocks — Wed, 24 Feb 2010 21:38:50 -0000

I'm starting to see this move from the March lows as 4000 point wave 1 on the Dow. A quick glance at the monthly chart of the Dow shows it clear as a bell. The monthly charts are not particularly bearish looking either. Neither are the weekly charts. In fact, they're starting to look bullish once again. It angers the absolute living hell out of me to tell the truth.

I hate to give up on the bearish case because I've honestly been bearish for most of my life. What makes me think that way is the phoniness, manipulation and spin involved in pumping up markets that without the media branch of the Fed (the MSM), would never have gone to the lofty levels they attained. But it is what it is. The markets are rigged and the whores have something like $14T to use to pump up the markets to 25,000 on the S&P if they want to. And it looks like they're gonna do it because if they do, they've saved their own greasy asses from total bankruptcy. How else are GS, BAC, C, JPM going to have any hope in hell of surviving? By buying and selling stocks back and forth between each other, pumping up the price each time. They're artificially inflating the value of stocks with money that in reality doesn't even exist. They "are not" going to let the markets even correct, let alone tank. I wish the motherf%^&ers would all just burst into flames, or better yet hang. But until that glorious day comes, I'm looking to get long for the first time in 10 years. And I'm going to hate every god damned minute of it.

Re: Elliott Wave Update ~ 24 February

Albertarocks — Wed, 24 Feb 2010 23:56:51 -0000

Asian markets are down pretty hard tonight and futures are suggesting a down day in our markets tomorrow. I'll believe that when I see it. So much for the skepticism but you know, I'm aggravated and owly as hell today. I'm just fed up with the bullshit, that's all.

But here's my good mood back again :-) For those of you who are interested in the MACDs, their directions, etc.:

For Feb. 25th, the MACD on the daily chart of the S&P will officially have rolled over at any price below 1094.70. I realize full well that doesn't offer any guidance about where the market is going tomorrow. It's just an interesting fact that I find somewhat reassuring... knowing that the markets are at a point where it won't take much to get those daily MACDs rolling down.

Re: E-minis

Albertarocks — Thu, 25 Feb 2010 11:16:48 -0000

He also claimed he invented the internet.

Re: E-minis

Albertarocks — Thu, 25 Feb 2010 13:10:28 -0000

We're at that tipping point aren't we. I like trading TZA because it's not nearly an manipulated as that monster DRV. The swings in that and DRN are designed to whip out as many bears and bulls every 15 min. as possible. It pisses me off. That's probably why I keep trading them, I'm defiant. lol

But hang in there, if TZA breaks out here, it's a whole new ballgame. One the other hand though, it's infuriating that the volume isn't there, once again. But if the market decides it's going south, I expect volume will pick up big time.

Re: E-minis

Albertarocks — Thu, 25 Feb 2010 13:38:58 -0000

salad, I use $RMZ as the index for DRV/DRN. If it's not the exact index, they track it perfectly anyway. $DJUSRE for URE/SRS. That's what I use. Those indices are plenty good enough to allow you to do some accurate chart work if you're inclined that way.

I already have FAZ. I'm underwater with it, but if I had more dry powder, I'd be buying it on a break over $18.80.

Re: E-minis

Albertarocks — Thu, 25 Feb 2010 13:57:59 -0000

The Canadians opened a can of whoop-ass on the Russians. lol

That's a very bearish last candle on the DAX.

Oh fk. Here it goes. The pump-job appears to have begun for the 9567th time since March. Those whores are really gettin' me pissed off here. In the face of the Greek downgrade, with Spain to follow and Portugal after that, and on and on, they run the god damned market up again. Yup! With the world on the brink of the biggest credit contraction in history, I guess that's as good an excuse as any to "buy more garbage". It's lunacy.

Re: E-minis

Albertarocks — Thu, 25 Feb 2010 15:12:00 -0000

You're right. Topping is indeed more of a process. There are a lot of little events along the way, such as today's slaughtering of the Greek treasury market, due to a downgrade. But the dark lords always fight that bad news and make the topping process a long and drawn out affair.

Bottoms on the other hand are almost always sudden and sharp events. When the market is exhausted from selling, the day will eventually come when even the slightest bit of good news will finally be accepted as a buying opportunity (when we're truly at a bottom). And at long last, a rally is supported whole heartedly by the mothers who run the show. As a result, the bounce at a bottom is usually spectacular. My problem is that I've been unable to spot those bottoms in the past. I think I'm much better prepared to spot them now that I've been back in the markets after a long, long haitus. I've been at it for about a year and a half now. My skills are getting sharper, but I don't know if I can last much longer as a bear. lol

Re: E-minis

Albertarocks — Thu, 25 Feb 2010 15:50:58 -0000

I'm blocked now?

Re: E-minis

Albertarocks — Thu, 25 Feb 2010 17:37:31 -0000

Me too. I guess my frustration gets out of hand and I get so angry with GS and their algos that I swear too much. I deserve it, if that's the reason.

Re: Elliott Wave Update ~ 25 February

Albertarocks — Thu, 25 Feb 2010 19:15:26 -0000

I've got something to share! Some good news for those who are bearish. Sorry bulls, you might not want to read this.

While the indices have been dicking around, driving me and probably a few other people stark raving mad, the MACDs have just kept doing their thing and have silently been setting themselves up for the big rollover. The MACDs on the daily charts are now so primed that it's barely gonna take any kind of a down move at all to flip them all bearish. For Friday, Feb. 26th, the MACDs on the daily charts will have officially rolled over at the following levels for these indices:

$RUT 625
$SPX 1095
$NDX 1801
$INDU 10238
$WLSH 11427
$TRAN 4049

These levels are very nearby, and if they were to roll over tomorrow, that would mean that the indices have put in new lower highs and so have the MACDs themselves. This is the exact type of action we're looking for as a pretty damned good confirmation that a bearish leg down is unfolding. These are on "daily" charts. They're darned serious events.

Re: Elliott Wave Update ~ 25 February

Albertarocks — Thu, 25 Feb 2010 20:28:14 -0000

Thanks cr3stfall. Yes, they're as accurate as can be calculated with the components as they existed at the end of trading today. I programmed an Excel spreadsheet with the formulas that go into calculating a MACD. Then I enter today's closing MACD, plus the individual components that go into its calculation as they existed at today's close. Then I ask it to "back-engineer" kind of, searching for a level where the tangent to the MACD's curve will be horizontal tomorrow. It's accurate enough for our purposes. A slight inaccuracy will occur because the 12 day and 26 day EMAs that I entered after close today, will be slightly different at open tomorrow. Those are the numbers I should be using, but of course, they don't exist yet. Changing one component changes them all, so it's a bit complex. But other than that, they're pretty good. I'm going to see if I can refine it even more though, to remove that little bit of error. lol Glad you like 'em.